LexSETH BIKHRAJ JAIPURIA versus UNION OF INDIA
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'
880
8UPREME COURT REPORTS
[I962j
1961
The
a ommission~r of
I nC<Jme--tax,
Bombay City I1
v.
consideration.
The result, therefore, is that all
these three appeab fail and must
be dismissed
with costs ; one heari1!¥ foe.
Appeal8 dismissed.
Shalr:untala and
two others, etc.
S •. K. Das J.
1901
July, 24.
SETH DJKHRAJ JAI~URIA
v.
UNION OF INDIA
(J. L. KAPUR, 1{. SUBBA RAO, M. HIDAYA'.l'ULLAH,
J. ·c. SnAH ;ind ~AGHUBAR DAYAL, ,JJ.)
'
Contract-Divisional. Supprintendent of Railway placing
orders-Cont,ract not 1 e:tpressed to be in name of Goverrior-
'
General and not executed on behalf of Governor-General-Whethei·
binding on G6uern1nent- (/overnmi:nt of India Act, 1935 (26 Geo.
IJ Ch. 2) s. f715 (3).
'
In the year 1913 the Divisional Superintendent, East
lti<liciu Raihvay piacecj certain purcha~e oi<lers with the appel-
lant for the supply "of foodgrains for the employees of the
East ~ndian Railway. , The orders \\:'ere not ('Xpressed to be
made .in the name Of the Governor-General and were not
executed on ~ehal( of the !J.overnor-General as required by
s. 175 (3) of the Government oflnclia Act, 1935. They were
signed Dy the Divisional Superintendent eithef..inwhis oWn hand
or in the ·haiid of h'is PCrsonal Assistant.
Some deliveries of
foodgrains \.Vere made under theSe orders aild were aCcepted
and paid for by the Railway Administration.
But lhe Railway
i\dn1inistration declined to accept further deliveries of food-
grains. The-appellant sold the balance of foodgrains under the
purchase orders and fi.JetJ a suit to recover the difference bet-
\Vcen thC price realised Ly
~-ale and the contract price. The
respondent resisted the suit infe.r alia on the ground t.hat the
contracts were not Binding on it.
Held, that the contracts were not binding on the res-
pondent and it was not liable for damages for breach of the
contracts.
Under
s.17.'(3) of-the Government of India Act,
J 935, as it stood at the relevant time, the contracts had:
(a) to be expressed to be made by the Governor-General, (b) to
be executer! 0n hehalf of the Governor-General and (c) to be
·executed by officers duly appointed in that behalf and in such
manner as the Governor-General directed or authorised. The
•
·2 S.C.R.
SUPREME COURT REPORTS
881
authority to a persun to execute contracts may be conferred
not ouly by rules expre,oly framed and by formal notifications
issued in this behalf but may also be speci;illy conferreu. The
evidence in the case showeu that such authority was specially
conferred upon the Divisional Superintendent. But the con-
tracts were not expressed to be made by the Governor-General
and were not executed on liis behalf.
The provisions of
s. 175(3) were mandatory. The object of enacting these pro-
visions was that the State should not be saddled with liability
for unauthorised contracts and hence it was provided that the
contracts rr. ust show on their face that they were made by
the Governor-General and executed on his behalf in the
manner prescribed by the person authorised.
State of Bihar v. Mfs. Karam Chand Thapar and Bros.,
Ltd. (1962) I S. C.R. 827, followed •
Liverpool Borough Bank v. Turner, (1861) 30 L. J.
Ch. 379, Municipal Coiporation tf Bom/Jay v. Secretary of Slate,
I. L. R. (1905) 29 Born. 580, Kessoram Poddar and Co., v.
Secretary of State for India, I. L. R. (1927) 54 Cal. 969,
S. C .. Mitra and Co., v. Governor-General of India in Council,
I.L.R. (J9j0) 2 Cal. 431, Secrdary of State v. Yadavgir
Dharamgir, I. L. R. (1936) 60 Born. 42, Secretary of State v.
G.T. Sarin and Co., I. L. R. (1930) 11 Lah. 375, U. P. Govern-
ment v. LalNanhoo Mal Gupta, A. I. R. (1960) All. 420, and
Devi Prasad Sri Krishna Prasad Ltd. v. Secretary of State,
I. L. R. (1941) All. 741, referred to.
S. K. Sen v. P,-ovincial P. TV. D., State of Bihar, A. I. R.
(1960) Pat., Chatturbhuj VithaldasJasoni v. Morashwar Prash-
rarn, (1954) S. C.R. 817, J. K. Gas Plant Mfg., Co. (Rnmtur)
Ltd. v. King Emperor, (1947) l. C.R. 141, Moreshwar l'an-
garkar v. State of Bombay, (1952) S. C.R. 612, State uf Bom-
bay v. l'urshottam Jog Naik (1952) S. C.R. 674 and :>iate ~f
U.P. v. Manbodhan Lal Srivastava, (1958) S. C.R. 533, dis-
tinguished.
C1v1L APPELLATE JumsrnctroN : Civil Appeal
No. 86 of 1959.
Appeal by special leave from the judgment
and order dated March ~7, 1957, of the Patna
High Court in Appeal from Original Decree No. 359
of 1948.
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